ACIT, New Delhi V. Smt. Kanwaljeet Kaur Purewall Green Acres Farm, New Delhi

ITSSA 71/DEL/2009

• Counselvise Citation: [2011] 124 COUNSELVISE.COM (IT) 8641 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 21-01-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 05-01-2011
• Assessment Year: misc
• Appeal Filed On: 29-10-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MEHRISH VERMA
• Assessee Lawyers: SUMANTY CHADHA; VEENA AGGARWALC A
• Keywords: Block assessment

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D DELHI BEFORE SHRI C.L. SETHI AND SHRI K.G. BANSAL IT(SS)A. NO. 71(DEL)/2009 BLOCK PERIOD: 1.4.1995 TO 27.11.2001 ASSISTANT COMMISSIONER OF SMT. KANWAL JEET KAUR PUREWAL INCOME-TAX, CIRCLE 24(1), VS. GREEN ACRES FARM, GADIPUR, NEW DELHI. M EHRAULI, NEW DELHI. PAN: AALPK 8690C (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MEHRISH VERMA, CIT, D R RESPONDENT BY : S HRI SUMANTY CHADHA & MS. VEENA AGGARWAL,C.A. ORDER PER K.G. BANSAL: AM THE FACTS OF THE CASE ARE THAT SEARCH AND SEI ZURE OPERATION U/S 132(1) OF THE INCOME-TAX ACT, 1961 WAS CARRIED ON 27.11.2001 IN ATWAL GROUP OF CASES AT CALCUTTA, JAMSHEDPUR AND DELH I. ON THE BASIS OF THE SEARCH, PROCEEDINGS U/S 158BD WERE INITIATED IN THE CASE OF THE ASSESSEE ON 14.2.2007. THE ASSESSEE FILED A NIL RETURN . THE UNDISCLOSED INCOME OF THE ASSESSEE WAS COMPUTED AT RS. 12,47,180/- ON 23.2.2007 IN AN ORDER PASSED U/S 158BD READ WITH SECTION 143(3). IN TH E COURSE OF PROCEEDINGS BEFORE THE CIT(APPEALS)-XXIII, NEW DELHI, THE PLEA OF LIMITATION WAS ALSO TAKEN. IT WAS SUBMITTED THAT AS PER PR OVISION CONTAINED IN SECTION IT(SS)A NO.71(DEL)/2009 2 158BD, THE SATISFACTION CAN BE FOUND IN THE ORDE R PASSED U/S 158BC IN THE CASE OF SEARCHED PERSON AND IF NO SUCH ORDER IS PASSED IT WILL HAVE TO BE FOUND IN THE NOTE HANDING OVER THE SEIZED MATERI AL TO THE AO OF THE ASSESSEE AGAINST WHOM ACTION U/S 158BD IS CONTEM PLATED. IN ANY EVENT, THE SATISFACTION HAS TO BE IN WRITING AND IT HA S TO BE MADE BEFORE THE TIME PRESCRIBED IN SECTION 158BE. AFTER THE SAID D ATE NO ACTION IS FEASIBLE U/S 158BD. THE LD. CIT(A) CONSIDERED THE FACTS OF THE CASE AND ACCEPTED THE SAME BY REFERRING TO THE DECISION OF FULL BENCH OF DELHI TRIBUNAL IN THE CASE OF MANOJ AGGARWAL, (2009) 310 ITR (AT) 99. IN THIS CASE, THE SATISFACTION WAS RECORDED AFTER 14 MONTHS FROM THE EXPIRY DATE BEING 31.12.2003. THE NOTICE WAS ISSUED ON 22.2.2005. THE FINDING OF THE TRIBUNAL WAS THAT THE NOTICE SHOULD HAVE BEEN ISSU ED BEFORE 31.12.2003. THEREFORE, THE NOTICE WAS HELD TO BE BARRED BY LIMITATION. THUS, THE REVENUE IS IN APPEAL BEFORE US. 2. THE REVENUE HAS TAKEN THREE GROUNDS IN THE AP PEAL THE SUM AND SUBSTANCE OF WHICH IS THAT THE LD. CIT(APPEALS) ERRED IN HOLDING THAT THE ORDER IS VOID AS NOTICE U/S 158BD IS BARRED BY LIMITATION. IT IS MENTIONED THAT HE ERRED IN HOLDING THAT SECTION 158BE PROVIDES THAT THE IT(SS)A NO.71(DEL)/2009 3 NOTICE U/S 158BD MUST BE ISSUED BEFORE THE C OMPLETION OF THE ASSESSMENT U/S 158BC IN THE CASE OF THE SEARCH ED PERSON. 3. BEFORE US, THE LD. DR SUBMITTED THAT NO TIME LIMIT HAS BEEN PRESCRIBED U/S 158BE IN RESPECT OF ACTION TO BE TAKEN U/S 158BD. ON THE OTHER HAND, THE LD. COUNSEL RELIED ON THE DECISIO N IN THE CASE OF MANOJ AGGARWAL. 4. WE HAVE CONSIDERED THE FACTS OF THE CASE AND RIVAL SUBMISSIONS. IN THE CASE OF MANOJ AGGARWAL, IT IS INTER-ALIA MEN TIONED THAT HE WAS SEARCHED ON 29.8.2002. THE SATISFACTION NOTE WAS RECORDED ON 19.12.2002, WHICH IS BEYOND THE DATE OF BLOCK AS SESSMENT. THEREFORE, THE SATISFACTION RECORDED IS BELATED. THE RELEV ANT PARAGRAPH READS AS UNDER:- 125. IN THE INSTANT CASE, WE MAY NOW EXAMINE WHETH ER THERE IS ANY RECORD OF SATISFACTION THAT MEETS THE REQUIREME NT OF LAW AS ENUNCIATED ABOVE. WE HAVE ALREADY REPRODUCED THE CO PY OF THE SAID RECORD DATED 19.12.2002. IT IS SIGNED BY THE D Y. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE -3, NEW DELHI. IT IS THEREFORE ADMITTEDLY RECORDED BY THE ASSESSING O FFICER MAKING THE 158BD ASSESSMENT AS THE NOTICE UNDER THE SAID IT(SS)A NO.71(DEL)/2009 4 SECTION HAS ALSO BEEN ISSUED BY HIM. THIS NOTE RE CORDS THAT SEARCH IN THE CASE OF SHRI MANOJ AGGARWAL AND ASSOC IATE CONCERNS AND THE BLOCK ASSESSMENT MADE ON HIM CONCL USIVELY ESTABLISHES THE FACT THAT HE WAS INVOLVED IN PROVID ING BOGUS ACCOMMODATION BOOK ENTRIES TO VARIOUS PERSONS ON CO MMISSION BASIS AND FOR THIS PURPOSE HE HAD USED THE NAMES AN D BANK ACCOUNTS OF VARIOUS COMPANIES, BENAMI PROPRIETORSHI P CONCERNS IN THE NAMES OF HIS EMPLOYEES, IN THE NAMES OF RELA TIVES, VARIOUS HUF ENTITIES AND FIRMS AND ONE SUCH CONCERN IS M/S BISHANCHAND MUKESH KUMAR THE BANK ACCOUNTS OF WHICH WERE OPERATED BY S/SHRI MUKESH KUMAR AND SHRI BISHANCHAN D AGGARWAL; THAT THE SOURCES OF CASH AND CLEARING DEP OSITS AND THE WITHDRAWALS FROM THESE BANK ACCOUNTS NEED TO BE EXA MINED; THESE ACCOUNTS HAVE BEEN USED FOR ACCOMMODATION BOO K ENTRIES AND HENCE, UNDISCLOSED INCOME HAS ARISEN IN THE HAN DS OF THIS CONCERN WHICH HAS BEEN FOUND DURING THE COURSE OF S EARCH AND SEIZURE OPERATIONS IN THE CASE OF SHRI MANOJ AGGARW AL AND HIS ASSOCIATE CONCERNS; THUS, PROCEEDINGS U/S 158BD ARE APPLICABLE IN THIS CASE. ADMITTEDLY, THIS NOTE IS AFTER THE DA TE OF BLOCK ASSESSMENT IN THE CASE OF MANOJ KUMAR AGGARWAL WHIC H WAS FINALIZED ON 29.08.2002. FURTHER, THE NOTE OF SATIS FACTION IS NOT RECORDED BY THE DY.CIT, CENTRAL CIRCLE-3, NEW DELHI ACTING AS THE ASSESSING OFFICER MAKING THE ASSESSMENT U/S 158 BC OF MANOJ KUMAR AGGARWAL SINCE THE SAID ASSESSMENT HAS BEEN FINALIZED EARLIER. CLEARLY THE NOTE OF SATISFACTION DATED 19.12.2002 IS BEYOND THE DATE OF BLOCK ASSESSMENT I N THE IT(SS)A NO.71(DEL)/2009 5 158BC PROCEEDINGS DATED 29.8.2002 IN THE CASE OF SH RI MANOJ AGGARWAL. THEREFORE, THE SATISFACTION RECORDED IS BELATED. 4.1 THE LD. CIT(APPEALS) HAS FOLLOWED THE DECISI ON IN THIS CASE AND POINTED OUT THAT SATISFACTION HAS BEEN RECORDED AFTER 14 MONTHS OF THE EXPIRY OF THE DATE I.E., 31.12.2003. THE NOTIC E WAS ISSUED ON 22.2.2005, WHICH IS DELAYED BY ANOTHER 13 MONTHS. THUS, THE FINDING IS IN CONSONANCE WITH THE DECISION OF SPECIAL BENCH OF THE TRIBUNAL, WHICH IS BINDING ON THIS DIVISION BENCH ALSO. ACCORDINGLY , IT IS HELD THAT THE ORDER COMPUTING THE UNDISCLOSED INCOME WAS BARRED BY LIM ITATION. 5. IN THE RESULT, THE APPEAL IS DISMISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT ON 21 JANUARY, 2011. SD/- SD/- (C.L. SETHI) (K.G.BANSAL) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE OF ORDER: 21ST JANUARY, 2011. SP SATIA COPY OF THE ORDER FORWARDED TO: SMT. KANWALJEET KAUR PUREWALL GREEN ACRES FARM, N EW DELHI. ACIT, CIRCLE 24(1), NEW DELHI. CIT(A) CIT THE DR, ITAT, NEW DELHI. ASSISTANT REGISTRAR.